So they bought a piece of rock to which no country had laid claim in fifty years; they declared sovereignty (though—as Tor had learned—there was no international court to which one must petition for the sovereignty of a piece of unclaimed land!); and they turned it into an international tax haven.
Pearl herself had done the econometrics and the setup single-handedly, requiring that any business done here on the island—if they wanted to receive the tax-free seal from her—must be conducted in the “local currency,” and she would decide the rate of that currency against the others, taking her profit margin against the market. It was just like the retail FX business, where you changed money at an airport and their fee was built into the exchange rate—something Pearl did every day for the bank. Then, with those profits from her fees, she “took positions” in the world currency market each day, to increase her earnings—wholesale FX trading—the other side of the same coin.
But none of this was illegal, except the initial counterfeits they’d made. Even so, as long as those fake securities in the vault were believed by everybody to be real, the rightful owners still derived full benefit of their use as well!
The advantage to Pearl of joining this caper was that it was worth more than ten lifetime careers at any financial institution. Now she’d set up an economic system for an entire country—and a profitable one, at that. She was the Fed and the SEC, the treasury, Fort Knox, and all the mints and banks and brokers rolled into one! She wouldn’t have to look hard for a job, with references like those—but perhaps she wouldn’t need one. If they kept this island business going long enough to pay back all those loans with interest, she didn’t see why they couldn’t stay on an extra month or two and rake in a few more millions for themselves—and at no cost to anyone at all!
Pearl paused to survey the scene as she did every morning, took a deep breath of sea air, and descended the stone steps to the harbor. The young Greek fishermen stopped working and waved gaily as she passed. She headed down to the dock. The morning boat had just arrived from the mainland, and she picked up her usual batch of newspapers, which she threw into a big woven basket over her shoulder. Then she went along the quay to the sailors’ pub for a cup of coffee.
She was on her second cup and third newspaper when she found it. She sat there a moment without breathing, then took a red pencil from her bag and circled the ad. Cursing softly to herself, she gathered the scattered newspapers, threw some money on the table, and hurried out of the restaurant.
She climbed the hill and went along the cobbled street to the sail makers’—a barnlike structure that Tor had purchased as their headquarters. Entering the dark main floor, she nodded to the Greek boy who served as receptionist, handyman, and guard. Then she climbed the rickety stairs to the next floor. Without knocking, she threw open the door of the first room on the left.
“Read it and weep,” she told a surprised Tor, tossing the tattered, two-day-old copy of The Wall Street Journal on the desk before him. It was folded open to the notice she’d circled in red.
He glanced at it quickly; his face became grave.
“So they’ve exercised their call option to pay off these bonds,” he said. “What’s the face value of what we hold of this issue—and how many banks is it scattered in?”
“Hang on to your hat,” Pearl told him. “We have to come up with twenty million—right now—to cover these bonds. These that have been called are securing our loans in half a dozen French banks, and one in Italy. That’s the money you used to buy this lovely island. If we can’t cover those loans, and they find out about the fake duplicates in the vault, we’re going to have plenty of time in prison to remember how charming—but brief—a time we spent here.”
“I’m surprised you haven’t earned that much in profit already,” said Tor with a smile. “You’ve been trading currency for six weeks, here in a tax-free haven. And you are, after all, one of the top FX traders in the world.”
“Who told you that?” snapped Pearl.
“Why, you did, my dear. But I’ve anticipated this, and I know how to raise the money quickly without jeopardizing our freedom or asking our California friends to bail us out. If we handle it right, I might even wind up with enough cash left over to win my bet!”
“If you think I can pick up that kind of cash by peddling my body to those boy sailors down there—it won’t even get us bus fare home,” said Pearl. “What did you have in mind?”
“Something more pragmatic—though perhaps less interesting, from your viewpoint,” he told her with a smile. “In fact, it’s been part of my plan from the very beginnings—we just need to change the schedule by a week or two. My dear, I think it’s time to sell our little country.”
FRIDAY, MARCH 12
The Vagabond Club sat, dripping in ivy and nostalgia, on the steep-curved lip of Nob Hill in San Francisco. Just off the harlequin-marbled entrance hall lay the vast reading room, its beveled windows overlooking Taylor Street’s hurtling descent to the Tenderloin. Here in the silence of the reading room—with its Prussian-blue-and-peach carpets, massive library tables, dark wood wainscoting, and French oils from various Paris exhibitions—the warm aura of nineteenth-century San Francisco still existed.
Downstairs in the Red Room, place settings for one hundred had been laid; the Waterford candlesticks sparkled, the bone china shone in the dim romantic light, and dark red roses, the color of blood, were thickly clustered in crystal bowls at the center of each round table.
In the adjoining room, behind heavy double doors, the gentlemen, dressed in black tie, were
